Motorola Solutions, Inc. v Hytera Communications Corporation (Transcript Tender) [2020] FCA 1605

Federal Court of Australia

Motorola Solutions, Inc. v Hytera Communications Corporation (Transcript Tender) [2020] FCA 1605 File number: NSD 1283 of 2017

Judgment of: PERRAM J

Date of judgment: 7 October 2020

Date of publication of reasons: 5 November 2020

Catchwords: EVIDENCE – application to tender portions of US transcript – where portions of transcript already tendered subject to s 136 Evidence Act 1995 (Cth) direction – whether Court may dispense with application of hearsay provisions under s 190(3) Evidence Act 1995 (Cth)

Legislation: Evidence Act 1995 (Cth) ss 136, 190(3)

Division: General Division

Registry: New South Wales

National Practice Area: Intellectual Property

Sub-area: Patents and associated Statutes

Number of paragraphs: 13

Date of hearing: 7 October 2020

Counsel for the Applicant: Mr C A Moore SC with Mr A R Lang SC and Ms P Arcus

Solicitor for the Applicant: Herbert Smith Freehills

Counsel for the Respondents: Mr C Dimitriadis SC with Mr J Cooke and Mr C Burgess

Solicitor for the Respondents: Shelston IP Lawyers

REASONS FOR JUDGMENT

(REVISED FROM TRANSCRIPT) NSD1283 of 2017

BETWEEN: MOTOROLA SOLUTIONS, INC. Applicant

AND: HYTERA COMMUNICATIONS CORPORATION LTD First Respondent

HYTERA COMMUNICATIONS (AUSTRALIA) PTY LTD ACN 165 879 701 Second Respondent

PERRAM J: 1 On the 23rd day of the second tranche of the trial, Hytera sought to tender portions of the transcript of the cross-examination of Mr Luo in the US proceedings before Judge Norgle. This was objected to by Motorola and debate on the issue was stood over for further argument today, 7 October 2020. 2 The issues are a little complex. One of the defences which Hytera pursues in relation to those parts of Motorola's claims which involve the grant of discretionary relief is that Motorola delayed in informing Hytera of the conduct of the three ex-Motorolans. I shall refer to this as the delay defence. The delay defence has been a continuing source of procedural unhappiness in this trial. Essentially the defence works this way: Hytera says that by reason of Motorola's delay in informing it of the departure of the three ex-Motorolans, Hytera was prevented from commencing the rewriting of the source code for its devices. 3 As events occurred, that rewriting process is said to have commenced in the middle of 2019. Hytera says that had it been notified earlier of the departure of the ex-Motorolans, then it would have had the opportunity to rewrite its source code at an earlier time and, had it done so, it would not now potentially be liable to Motorola for infringement which occurred during that period. The raising of that defence has given rise to a factual dispute between the parties. The factual dispute concerns what Hytera knew about the presence of Motorola code in its source code and when did it know it. 4 The position of Hytera is that it did not commence the rewriting process until it was provided by Motorola with the particulars of the infringements which Motorola claimed that Hytera had engaged in. That appears to have been, as I have said, in the middle of 2019. The position of Motorola, by contrast, is that Hytera had itself already begun investigations into the events to which the arrival of the three ex-Motorolans had given rise in 2017. Motorola alleges, and has sought to demonstrate, that Hytera had become aware by June 2018 that there was some Motorola code in its source code. This issue, which had simmered under the surface for some time, finally bubbled to the surface on day 13 during the evidence of Mr Luo. 5 Mr Moore cross-examined Mr Luo on that day and, at T790.16-790.46, obtained a concession by Mr Luo that Hytera had discovered the presence of Motorola's source code by June 2018. That concession by Mr Luo was obtained by cross-examining him on page 3149 of Mr Luo's evidence before Judge Norgle where at line 11-15 he had given evidence as follows: I said earlier that it was until June of 2018, after we had conducted a large amount of investigation, that we found that a small portion of Motorola's code was used on our products, on part of our products. 6 Motorola subsequently sought to tender extracts of the transcript of Mr Luo's cross-examination in the US proceeding, but subject to a limitation under s 136 of the Evidence Act 1995 (Cth) ('the Act') that the transcript only be used to make sense of the cross-examination which had occurred on day 13. Although I have not set out the transcript of the US cross-examination in full, it is apparent from an examination of it that references to portions of it do not always make sense without references to the full transcript. However, the effect of the s 136 direction which I made at that time was that the limited extracts, which were put in evidence, were only to be used for the purpose of making it possible to understand what Mr Luo's evidence in this Court was. 7 And it was in that context that on day 23 Hytera then sought to tender further extracts of the cross-examination of Mr Luo before Judge Norgle. Motorola objected to this on the basis that it was hearsay evidence. As the argument played out before me today, I did not understand it to be submitted by Hytera that the transcript was not hearsay evidence within the meaning of the Act. Instead, Hytera submitted that I should dispense with the application of the hearsay provisions of the Act pursuant to s 190(3). It provides as follows: 190 Waiver of rules of evidence (3) In a civil proceeding, the court may order that any one or more of the provisions mentioned in subsection (1) do not apply in relation to evidence if: (a) the matter to which the evidence relates is not genuinely in dispute; or (b) the application of those provisions would cause or involve unnecessary expense or delay. 8 Hytera developed two submissions. First, it said that the ground in s 190(3)(a) was established, because the matter was not genuinely in dispute. I should say by way of interpolation that the point Hytera wishes to make by the tender of the extracts from Mr Luo's cross-examination is that his reference to Hytera being aware by June 2018 that there was present in the Hytera source code some of Motorola's code was in error and that the full extracts from the transcript would show that this matter was not known until June 2019. 9 In pursuit of its submission that the exception in s 190(3)(a) was established, Hytera took me to the closing submissions made by counsel for Motorola in the US proceeding, and developed a submission that counsel in that case had accepted, or at least had made a submission consistent with, the notion that Hytera had not been able to work out that the Motorola code was present until June 2019. In particular, I was taken to a passage of the US transcript at p 5657. So the submission was that it was not seriously in dispute in the proceeding that this aspect of Mr Luo's evidence was not correct. 10 I do not accept that submission. Perusal of the US transcript shows that this is not a correct characterisation of the submission which was made by Motorola's counsel in the US proceedings. What is being touched upon at p 5657 is the validity from Motorola's perspective of Hytera's suggestion that they could not work out that the Motorola code had appeared in the source code until June 2019. It is in that context that the passage at p 5657 is to be understood. Consequently, I do not accept that it is not genuinely in dispute between the parties that Hytera was aware by June 2019 that the Hytera source code contained elements of the Motorola source code. 11 Hytera then developed a second submission in reliance upon s 190(3)(b) that the application of the hearsay provisions would cause or involve unnecessary expense or delay. Here, the argument was that if Hytera was not permitted now to tender the extracts of the transcript of Mr Luo's evidence before the US court, then this would or might make it necessary for Hytera to seek to recall Mr Luo to give evidence. There may or may not be issues as to the entitlement of Hytera to recall Mr Luo. If he is recalled, there may be some difficulties attending counsel's examination in chief of Mr Luo. It is not necessary, however, to embark upon any examination of Hytera's entitlement to pursue that course. That is because I am prepared to make the assumption in Hytera's favour that it would be successful in seeking to recall Mr Luo for the purposes which it now foreshadows. 12 In the context of this trial, which has extended over a substantial period of time and which has involved great practical difficulties from both sides and undoubtedly the incurring of very considerable expense, I do not think that the expense or delay which would be associated by recalling Mr Luo, if Hytera seeks to do so, would be unnecessary in the sense that is used by s 190(3)(b). Consequentially, I do not think that the dispensation power set out in s 190(3)(b) is enlivened. 13 Consequently, I decline to exercise the power in s 190. It follows that the US transcript is hearsay evidence to which the Act applies and is inadmissible. I therefore reject the tender. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Perram.